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oil giant Chevron accountable for its human rights
and environmental abuses in Ecuador

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Wednesday, April 28, 2010

Several weeks ago, the indigenous and farmer communities revealed new information that Chevron "cooked" evidence in the Lago Agrio trial in order to avoid a judgment in the long-running lawsuit – and that the oil company was providing financial support to whistleblower Diego Borja to prevent him from going public with the company's fraud. Among Chevron's gross misdeeds in Ecuador, according to Borja: the oil giant directed Borja to create dummy companies in Ecuador to make it appear that a laboratory Chevron used to process soil and water samples during the environmental trial was independent, when in fact it was controlled by the company.

The Plaintiffs have long contended that Chevron was intentionally and fraudulently using bogus lab testing procedures to artificially lower the amount of contamination reported to the Court.

Borja, an Ecuadorian who was responsible for handling soil and water samples for Chevron during the environmental trial, was captured on audiotapes provided by childhood friend Santiago Escobar as saying Chevron "cooked" the evidence in the trial, and that he [Borja] has "correspondence about things you can't even imagine, dude….I can't talk about them here, dude, because I'm afraid, but they're things that can make the Amazons win this just like that (snapping his fingers)." (Click here for more information. See Transcript 4, October 1, 2009 p. 3, 7-9)

Borja was quoted demanding a "business partner(ship)" with Chevron that would pay off "like a big brass ring" in exchange for not turning over the evidence to the authorities. (See Transcript 2, October 1, 2009, pg. 6) He also bragged to Escobar, in reference to his work for Chevron, that "crime does pays." (See Transcript 1, October 1, 2009 p. 6)

At the time of the recording, Borja was (and apparently still is) receiving payment from Chevron for a number of expenses. Some might call this "hush money" to ensure Borja doesn't sing with too sweet a melody about Chevron's fraud in Ecuador. Among Chevron's payments to Borja:

A monthly stipend: On the tapes, Borja said that he made $10,000 per month while living in Ecuador and that Chevron is paying him an amount that allows him to live at the same level in the United States. Given that the cost of living in Ecuador is much lower than the U.S., the amount Chevron is now paying Borja is probably a healthy multiple of $10,000.

Re-location costs: In June 2009, Chevron obtained visas from the U.S. government and paid expenses to re-locate Borja and his family from Ecuador to San Ramon, California, Chevron's headquarters. Borja's wife, Sara Portilla, worked for Chevron for several years and apparently ran a Chevron laboratory that processed samples from the trial, even though Chevron had told the court the laboratory was independent.

Legal fees: Chevron has told reporters the company is covering Borja's legal expenses, including the fees of his criminal defense attorney, Chris Arguedes. Arguedes is a well-known criminal defense lawyer who represents Barry Bonds, among other notables. Paying for Borja's lawyer ensures that Chevron will limit the chance he has to be questioned by authorities about Chevron's own role in the fraud.

Housing: Borja said on the tapes Chevron is paying for a fully-furnished $6,000 per month house with a swimming pool in a gated community in San Ramon.

Car: Chevron is making a Saturn SUV available for Borja and Portilla to drive.

Security: Chevron is providing a security detail for Borja.

From living in Ecuador to living the high life in California – for Diego Borja, it is clear that crimes does pay.

Tuesday, April 27, 2010

In a previous entry, we detailed how Chevron lied to Columbia Journalism Review writer Martha Hamilton about the operation of a well site called Shushufindi 38 in the Ecuadorian rainforest and the amount of toxic contamination at the well to convince her that 60 Minutes had not been fair to Chevron in its coverage of an environmental lawsuit against the oil company for extensive oil contamination.

Chevron told her the government-owned oil company Petroecuador operated the site, and fecal matter, not oil, had contaminated the well. Both statements are flat-out lies that Hamilton accepted as fact but 60 Minutes checked and, as a result, did not report.

Upon further review, it looks like Chevron also lied to her about the drinking water well site near the oil well site.

A water sample taken in the trial directly from this freshwater well showed toxic levels of likely carcinogens and harmful heavy metals that are derived from oil, including benzo[a]pyrene, indeno[1,2,3]pyrene, and cadmium. The U.S. government has determined that each of these chemicals are likely or probable carcinogens, as reflected in a toxic substance registry maintained at the Centers for Disease Control in Atlanta. See this press release about the water well.

In her critique of the coverage, Hamilton wrote that the news show should have stated Petroecuador was responsible for the cleanup of the well site under a 1995 agreement. (It's unclear if she meant drinking water or oil well, but either way both has dangerous levels of contamination.)

But the agreement she references is the centerpiece of the legal dispute, as 60 Minutes clearly says. Following the visuals of Shushufindi 38, the news show states:

"Chevron says the pollution is now the responsibility of Petroecuador. That dispute is at the heart of the lawsuit."

Even though Hamilton says she is not weighing in on the merits of the lawsuit, one has to wonder why she did not contact the plaintiffs to check basic facts, something that we are sure Columbia Journalism Review would encourage all journalists to do.

Monday, April 19, 2010

Shushufindi 38, the famous pit closed by Texaco in 1984 as seen in recent months. Chevron’s tests found no contamination here.

Chevron has told the highly respected Columbia Journalism Review a flat-out lie about an oil well site in Ecuador and the harmful level of contamination found at the site’s oil pit, featured in a 60 Minutes piece that aired almost a year ago.

In a critique of 60 Minutes’ coverage of the eco-disaster lawsuit filed by indigenous tribes in Ecuador against Chevron, CJR writer Martha Hamilton said the CBS news show should have reported that the government-owned oil company Petroecuador operated the well site Shushufindi 38 after Texaco left Ecuador in 1992.

Had Hamilton contacted the plaintiffs in the lawsuit about her pending critique, she would have learned that Chevron lied to her. Court documents clearly show that only Texaco operated the well site, which Texaco closed in 1984.

Chevron also told Hamilton that soil tests turned up no contamination at the site. Again, court documents clearly show this to be false. Tests from the plaintiffs revealed illegal levels of toxins at over 400 times the Ecuador legal limit of 1,000 parts per million of Total Petroleum Hydrocarbons and over 4,000 times the legal limit as allowed in most states in the United States (about 100 ppm of TPH).

Chevron’s tests at the well site pictured above, on the other hand, showed no contamination. Why? Chevron took its test samples uphill and away from the well site. Taking soil samples far away and uphill from toxic waste sites where Chevron knows it will find little or no contamination, and then using those same samples to report the toxic waste sites pose no risk to human health, is part of the company’s fraud in the Ecuador litigation.

Hamilton also argues that 60 Minutes should have spent more time explaining the 1995 remediation agreement between Texaco and the government of Ecuador. Hamilton reported that Petroecuador is responsible for cleaning up Shushufindi 38, but we disagree.

If 60 Minutes had spent more time explaining the remediation agreement, viewers would have understood why we disagree, and Chevron would have looked even worse. Viewers would have learned that Texaco and Ecuador’s government negotiated the agreement after the plaintiffs filed their lawsuit in the US in 1993. They also would have learned that the agreement applied only to potential government claims, and expressly excluded the private claims being heard in the lawsuit.

Viewers also would have been told about how Texaco claimed to have cleaned about 16% of over 900 oil pits built by Texaco, a clear violation of its agreement with Ecuador’s government (which required it to clean 37% of the pits). Yet Texaco didn’t actually clean those pits. It just bulldozed dirt over them. Hundreds of tests taken at these “remediated” oil pits demonstrate they are as toxic as the pits that Texaco didn’t clean. Even Chevron’s tests submitted into court evidence show that Texaco did not clean these pits. The entire clean-up on which Chevron’s defense rests was a sham.

Because Texaco said it cleaned the pits, people living in the area thought they were cleaned so they built homes directly on top of toxic waste dumps. Here’s an example at a so-called “remediated” pit at Shushufindi 43.

A home built on top of Texaco’s toxic oil pit at Shushufindi 43.

As a result, Texaco’s phony cleanup resulted in putting people even closer to the contamination, increasing the risk of exposure to harmful chemicals. Match that up with the fact Chevron has never issued a warning to the local population that the pits are dangerous hazardous waste sites.

Had Hamilton contacted both sides, she could have written a completely different story: about how Chevron is attacking 60 Minutes so it can divert attention from its cover-up of Texaco’s phony cleanup.

Thursday, April 15, 2010

A Chevron contractor in Ecuador, Diego Borja, claims the company cooked evidence and created dummy corporations to process laboratory samples – all in an effort to avoid a judgment in a large environmental trial.

Diego Borja

Chevron’s response: No comment.

But that’s just not good enough. Chevron should answer the explosive questions raised by Borja and turn over any evidence that Borja has regarding the lawsuit filed by Ecuadorians living near and, in some cases, on top of oil pits filled with toxic chemicals that were left in Ecuador by Texaco.. (See other posts on The Chevron Pit that feature people living near the pits who have died from cancer.)

Borja says he has the proof of his allegations on his iPhone and in documents stored in Ecuador. Borja says his wife, Sarah Portilla (also a Chevron contractor), knows everything as well. More details about the damaging evidence

In fact, Borja’s relationship with Chevron is a family affair in place for at least three decades. Borja’s uncle has worked for Chevron for 30 years and owns the building where Chevron’s Quito attorneys lease office space, and where his nephew and Portilla have offices as well. One big unanswered question is the role of Chevron’s Ecuador-based legal team in working with Borja in his questionable efforts to undermine due process of law. Borja is now being paid a substantial sum by Chevron for carrying out his various dirty tricks operations.

In conversations with a childhood friend, Santiago Escobar, Borja tells him that he collected soil and water samples at contaminated well sites on behalf of Chevron and that he and his wife accepted the samples as representatives of Chevron’s “independent” laboratory, Severn Trent Labs, Inc. and then stored them in their office refrigerator. Court records obtained by the plaintiffs show Borja and Portilla’s signatures on chain of custody documents. of documents Download PDF

Borja says that Chevron’s lab is not independent, and that it “belonged” to Chevron and that he rented a house where a Chevron lab was located in Ecuador. Yet Chevron presented laboratory samples to the court during the trial from an independent lab.

The Ecuadorians, who are suffering the consequences of Chevron’s actions, as well as Chevron’s own shareholders, deserve answers to the disturbing charges leveled by Borja.

Here’s a sampling of just a few of Borja’s troubling statements:

“Chevron always stayed, supposedly, independent, and sent the analysis to have them analyzed… But I know that’s not true … I have proof that they [laboratories] were more than connected, they belonged to them.” . (Transcript 6, October 1, 2009 p. 6-8; Transcript 11, October 1, 2009, p. 6)

“I have correspondence that talks about things you can’t even imagine, dude….I can’t talk about them here, dude, because I’m afraid, but they’re things that can make the Amazons win this just like that (snapping his fingers).” ).” (Transcript 4, October 1, 2009 p. 3, 7-9)

“….if the judge here (in the U.S.) finds out that the company did cooked things, he’ll say, ‘Tomorrow we better close them down,’ you get it?” (Transcript 6, October 1, 2009 p. 10-11)

When he first spoke with Chevron about the videos, Borja said he expected to be covered in terms of security and economically – “in everything” after handing over the videos. He told them, “Obviously, I’m not going to ask for anything now, because it would ruin everything.” Chevron told him not to worry, but it is “totally understood.” (Transcript 21, October 7, 2009 p. 11)

According to Borja, Chevron told him “We can’t give you money because…it would compromise the evidence…. What we can do is (make you) our business partner.” Borja continued, “Now, that little word means a lot of things, right?”When Escobar then said, “the objective is to become their partner. I mean, once you’re a partner of the guys, you’ve got it made,” Borja replied, “That’s right you dog. So, I… I’ve seen how things work here now. I mean, it’s a brass ring this big, brother.” (Transcript 2, October 1, 2009 p. 6)

Borja said he formed four companies for Chevron in order to make the work he did appear to be independent of Chevron. He implies that Chevron controls these companies. (Transcript 4, October 1, 2009 p. 12-13; Transcript 6, October 1, 2009 p. 9)

Sounding angry, Borja said Chevron could not force him to testify. “I told them,…if I feel that I’m being tricked, you’ll eat shit.” ….they’re (Chevron executives) right here, 40 minutes from me… from where I live. Just 45 minutes away is the office of the [Unintelligible], so I just show up, ring the bell and everyone knows who I am. I sit down and tell them, ‘Let’s see, this is the way it is.’ And the joke is over, dude, you get it?.... I’ll shit on them in a second [Unintelligible]. I mean, what they… what I’m trying to explain to them is that I also have… I don’t know how much to say, but I have only so much patience, you get it? (Transcript 5, October 1, 2009 p. 4-5, 11)

Washington, DC (April 6, 2010) – In a series of stunning revelations from recorded conversations, longtime Chevron contractor Diego Borja threatened to reveal damaging evidence “cooked” by Chevron in the environmental trial in Ecuador unless he received enough money for turning over secret videotapes to high-ranking Chevron executives in June 2009.

Borja’s disclosures are found in a report released today by Grant W. Fine, a lawyer and investigator hired by the plaintiffs. The report covers more than six hours of audiotapes and 25 pages of online chats that were given to the plaintiffs by Santiago Escobar, a childhood friend of Borja who made the recordings.

In the conversations, Borja said Chevron hired him to create four companies so his work for the oil company would appear “independent.” He suggested that the companies were connected to a laboratory to test contamination samples. Borja said the laboratory was not independent, but rather “belonged” to Chevron.

The investigative report also revealed that Borja’s wife, Sara Portilla, worked for Chevron for four years and represented Severn Trent Labs (STL), a US laboratory that Chevron described as an “independent” lab to test its contamination samples. Court documents obtained by Fine cite Borja and Portilla as representatives of STL. They both signed chain of custody documents with the Lago Agrio court that showed how the samples moved from the contamination site to the testing lab.

Borja – who Chevron always has cast as a good Samaritan – also said that Chevron is paying $6,000 a month in rent for his large home with a swimming pool that abuts a golf course in a gated community near Chevron’s headquarters. Borja said that Chevron is paying him the U.S. equivalent of the salary he made in Ecuador, which was $10,000, and is also paying the costs for a lease on an SUV and for personal security.

On the audiotapes, Borja said he has enough evidence to ensure a victory by the Amazon communities if Chevron failed to pay him what he was promised. Before turning over the videotapes to Chevron, Borja said he made sure Chevron “completely understood” he wanted payment for them.

He also said he had incriminating evidence against the oil giant stored on his iPhone and in an undisclosed location in Ecuador that he could use as leverage if Chevron betrayed him. Specifically, Borja said he has a notarized document that contains a version of events that would help the plaintiffs and that Portilla, his wife, is aware of the information.

Representatives of the Amazon communities reacted with shock to the audiotapes. “They prove at a minimum that Diego Borja is a real con man,” said Luis Yanza, President of the Amazon Defense Coalition, which represents the plaintiffs.

Yanza called on Chevron to investigate and disclose the information that Borja has stored on his iPhone and in Ecuador.

Yanza also called on authorities in Ecuador and the U.S. to examine the tapes and include them in their investigation of the videotaping scandal, which Chevron disclosed last August as a way to derail the trial. Chevron also cites the videotapes as evidence of corruption in its arbitration claim against the government of Ecuador, which Chevron filed in September, only four weeks after revealing the videotapes.

Escobar, who said he has known Borja since they were teenagers, said he decided to give the tapes to the plaintiffs because if “I keep quiet about immoral acts, then I become part of the immoral acts.” He said, “Diego always bragged to us about what he was doing with the testing samples to help Chevron avoid prosecution. Everyone knew he was Chevron’s dirty tricks guy. Overtime, I became more disgusted with what Diego was doing. The videotapes and his interest in switching sides was the last straw for me.”

Among other revelations, Borja said:

If Chevron “tricked” him he would “immediately go to the other side… I have correspondence that talks about things you cannot even imagine, dude… I can’t talk about them here, dude, because I’m afraid, but they’re things that can make the [plaintiffs] win this just like that” at which point he snapped his fingers. He also said, “crime does pay.”

Chevron had “cooked” the evidence and, if the U.S. judge who sent the case to Ecuador in the first place ever knew, he would “close [Chevron] down.”

The energy giant used him to set up four dummy companies to make them appear to be independent of Chevron, but in fact they were controlled by Chevron.

The laboratory that processed soil and water samples for Chevron to submit as evidence in the trial was not “independent” as the company represented to the court. “I have proof that they [the laboratories] were more than connected, they belonged to [Chevron],” said Borja, who also indicated he signed the contract to rent the house where Chevron’s laboratory was located.

Escobar also told Fine that Borja said he and wife stored testing samples in their refrigerator in their Quito office before mailing them to STL. (Test America, Inc., purchased STL in 2007.)

Borja indicated that he and a person from Chevron, whom he referred to as his Florida-based boss, lied to gain entry into the independent laboratory that was processing the soil and water samples for the plaintiffs during the trial. (Yanza said he suspects the person is Ricardo Reis Veiga, a longtime Chevron lawyer based in Miami currently under indictment in Ecuador for lying about Texaco’s remediation results.)

Borja said he has worked for Chevron on the Aguinda trial since 2004 and has signed numerous court documents – contrary to Chevron’s claim at the time it released the videos that Borja was a mere “logistics contractor” for the company. Portilla has worked for Chevron for four years, and his uncle has been employed by Chevron for 30 years. Borja also said he has worked for Chevron since he was 24 years old (nine years ago). Chevron’s legal team, Borja, his wife and uncle have office space in a Quito building his uncle owns.

Borja conceded there was no bribe of the Ecuador trial judge, Juan Nunez, in the videotapes -- confirming the long held contention of the plaintiffs and contradicting Chevron’s assertions. With the videotapes, Borja said he did in “two days” what Chevron had been trying to do for a year, which was to get the judge dismissed.

Borja also said Chevron promised to make him a “business partner” for turning over the tapes. When Escobar said he would have it “made” once he became a partner of Chevron, Borja responded: “That’s right, you dog… I mean, it’s a brass ring brother.”

Fine, a lawyer and investigator based in San Francisco, California, conducted the investigation. Fine also conducted an earlier investigation into Wayne Hansen, the so-called American “businessman” who claimed to be in Ecuador to identify contract opportunities for remediation work and partnered with Borja to videotape meetings with Nunez and others, using a spy pen and spy watch. Fine discovered that Hansen had never worked in remediation before, currently has no means of visible financial support and was sentenced to 32 months in a federal prison for drug trafficking over 275,000 pounds of marijuana.

About the Amazon Defense Coalition

The Amazon Defense Coalition represents dozens of rainforest communities and five indigenous groups that inhabit Ecuador’s Northern Amazon region. The mission of the Coalition is to protect the environment and secure social justice through grass roots organizing, political advocacy, and litigation. Two of its leaders, Luis Yanza and Pablo Fajardo, are the 2008 winners of the prestigious Goldman Environmental Prize.

“The plaintiffs’ reports in question show illegal levels of contamination to human health and the environment. Chevron’s own reports at the same oil well sites also show illegal levels of contamination. While we take Dr. Charles Calmbacher’s statements about the reports seriously, we believe his recollection almost six years after the fact is inaccurate.

“Dr. Calmbacher clearly agreed to have his signature placed on materials, including reports, that were to be submitted to the court, and he acknowledged he was actively reviewing the reports with our local, technical team. We are bewildered, frankly, at his testimony.

“We know that Dr. Calmbacher’s testimony that there were no health risks contradicts public statements that he made in 2004, at the time of the judicial inspections. On August 27th, 2004, a major media outlet quoted him as saying: ''Their defense is a lot like the tobacco industry saying there is no evidence linking smoking and lung cancer,'' said Charles Calmbacher, a certified industrial hygienist who works as an expert for the plaintiffs.” (See below.)

“Finally, it is clear scientific evidence from the four sites in question, including Chevron’s own evidence, strongly suggests that the real fraud is Texaco’s phony cleanup that was used to secure a release from Ecuador’s government.”

“ChevronTexaco says it has seen no credible evidence to link such problems to oil exposure and cites reports by American experts who take issue with health reports presented by the plaintiffs.

“The company also insists that its tests show no presence of hydrocarbon contamination in drinking water and argues that cancer rates in the areas at issue are lower than in other parts of the country.

''Their defense is a lot like the tobacco industry saying there is no evidence linking smoking and lung cancer,'' said Charles Calmbacher, a certified industrial hygienist who works as an expert for the plaintiffs.”